Economics for health sector analysis: concepts and cases by Mead Over

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A. a. a. S. dollarsSource: De Ferranti (1985) and Cumper (1985). The bottom row of table 2 gives the averages of the five variables in this sample. 10 Central government allocations were on average 5 percent of the government budget and private sector expenditures were about 2 percent of ''disposable income," as defined in column 1. The Effect of Income on Health Care Expenditure A glance down any of the columns of table 2 reveals that each of the five variables under consideration here has a wide range of values.

These benefits will not appear if private for-profit health care facilities are allowed to exercise monopoly power. Page 5 1 The Health Sector in a Developing Economy Mead Over Links between Parts of the Economy In some respects, people who work in the health care sector are like the patients they serve: both are consumers of food, clothing, shelter, recreational activities, and other goods and services in the economy. , health care consumers) are, or will be, productive workers outside the health sector.

Furthermore, health expenditure per capita increases even more than income, since it generally represents a larger percentage of GNP as GNP increases. 8 percent for the East Asian countries. Note that this pattern occurs even in wealthier countries, like the United States, which spend 10 percent or more of their income on health care. But total health expenditure is the result of two separate, although not entirely independent, decision processes. First, the government decides what proportion of its budget (obtained by taxation and borrowing) will be spent on health care.

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